Closing date delayed for hotel land

TUSCALOOSA | Design details and the possibility of tax credit financing have delayed the sale of a downtown lot for an upscale hotel's development.

By Jason MortonStaff Writer

TUSCALOOSA | Design details and the possibility of tax credit financing have delayed the sale of a downtown lot for an upscale hotel's development.At the request of Kemmons Wilson Cos., the Tuscaloosa City Council's Public Projects Committee agreed Tuesday to delay the closing date of the lot's sale until March 31.The original closing date was Dec. 31 and, as part of the sale agreement, that's when the 24-month construction window would begin.“They still have the expectation that the project will be completed well before then,” said City Attorney Tim Nunnally, “but ... obviously didn't need the clock ticking so far in advance of the start of construction.”Kemmons Wilson Cos., based in Memphis, Tenn., is purchasing the city-owned, 2.02-acre tract commonly known as the CityFest lot for the development of a $27 million Embassy Suites hotel.The City Council in September gave its final blessing for the sale of the land at the northwest corner of the intersection of Greensboro Avenue and University Boulevard for $1.85 million to Wilson Hotel Management Group, a division of Kemmons Wilson Cos.McLean T. Wilson, vice president of Kemmons Wilson Cos., said the closing date extension should not slow the originally projected completion date of sometime before summer 2014.“It just gives us a little bit more breathing room, and we want to make sure we meet the expectations and timetables that the city has set before us,” Wilson said.One reason for the closing date extension is the completion of design details for the hotel's fine dining restaurant. The restaurant still will be operated by Chris Hastings, the owner and executive chef of Hot & Hot Fish Club and a winner of the Food Network's competition show “Iron Chef America.”“It's the nature of development,” Wilson said. “The coordination of the plans, especially the restaurant, is taking a little more design because we wanted to be very thoughtful with the restaurant design and in working with Hastings.“Anything that has a special element can sometimes take a little longer than you expect.”Another reason for the delay sprouted from the option for tax credit financing made available by the Alabama Legislature during its 2012 session.The Alabama New Markets Development Act provides, among other things, premium tax credits to investors in community development that fall within qualified, low-income or impoverished communities — especially central business districts — in Alabama. The act reflects similar rules contained with the federal New Markets Tax Credit and caps the amount an applicant can receive in any given tax year at $20 million, with a maximum qualifying credit for a particular project at $10 million.The hotel qualifies for tax credit funding because it falls within one of the designated areas, but Wilson said Wednesday that it was still unclear what percentage of the overall investment will come from the tax credit proceeds.Kemmons Wilson Cos. is now working with a tax credit consultant to find answers.Construction of the hotel, expected to begin soon after the closing, will bring about 125 jobs to the area. The hotel is predicted to hire about 60 full-time employees once it opens.The 150 rooms will be suites and will cost $135 to $145 per night, ranging from single-room suites with king-size beds to double suites with two queen-size beds.Other amenities in the hotel's plan will be cooked-to-order breakfasts each morning and an evening cocktail lounge, both staples of Embassy Suites, as well as a rooftop bar.The hotel will also have about 5,300 square feet of meeting space, an indoor pool with a large deck, a vaulted lobby and ceiling, and an overhead roof connected to the building's entrance that will provide shelter to vehicles entering or leaving on University Boulevard.